- Looking to buy Rio Tinto shares and get exposure to the mining sector?
- Find out about the different trading options and ways to buy.
- What to track in the mining industry and how to assess Rio Tinto’s performance.
Rio Tinto (LON: RIO) is the world’s second-largest metals and mining company. They constantly grow through mergers and acquisitions. The massive Anglo-Australian corporation has been trading successfully since 1873.
Rio Tinto extracts and processes dozens of metals and minerals. Their portfolio includes many of the battery metals that the world needs to reach its carbon reduction goals.
Read on for a guide to where you can buy their shares and how to do it for first-time investors.
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Step 1: Pick a share broker
Rio Tinto is listed on the London Stock Exchange and Australian Securities Exchange. Make sure that your broker has access to one of those stock markets in order to buy their shares.
Other attributes to take into consideration when choosing a broker include the cost of brokerage (many are now commission-free), what markets you can access, what you can trade (equities, commodities, etc.), whether you can buy fractional shares, and the overall usability of the trading experience.
If you are unsure about which broker to use, you can set up a demo account with some brokers — like eToro — and give it a trial run before funding your account.
It’s quick and easy to compare brokers with our comparison page on Finty.
Step 2: Fund your account
Once you've decided on a broker, you'll need to transfer money to your account in order to begin trading.
You can fund your account with a bank transfer or debit card. Some brokers also support credit cards and PayPal.
Step 3: Decide how much to buy
Since share prices can go up or down, it’s important not to invest any more than you can afford to lose.
You can use the pound cost average strategy to decrease your exposure to price volatility with periodical investments over time. Some brokers offer recurring buys so you can automate this.
Step 4: Choose between ETFs or shares
Another way to diversify your portfolio is to invest in an ETF (Exchange Traded Fund) with exposure to Rio Tinto rather than investing solely in Rio Tinto shares.
ETFs offer exposure to several companies and are often focused around a common theme. For instance, an ETF might only include shares of miners. Since an ETF is diversified across a range of stocks, they typically have lower volatility than a single stock. The trade-off is that they are less likely to experience a rapid increase in valuation.
ETFs with exposure to Rio Tinto include VanEck Steel ETF (SLX), Invesco International Dividend Achievers ETF (PID), and First Trust Indxx Global Natural Resources Income ETF (FTRI).
Step 5: Configure your order
The easiest order is the market order, which means the broker buys shares at the next available market price.
Most brokers also offer the ability to set up orders that are automatically triggered under specific circumstances. For example, you could configure an order to automatically buy or sell Rio Tinto shares when they reach a pre-defined price.
Step 6: Place your order
Once you've configured your order, submit it to buy shares.
As well as tracking the Rio Tinto share price, it is important to understand what is happening in the mining and metals industries. Rio Tinto is involved in extracting a wide range of metals and minerals across the world.
Considering the move to electrification, demand for rare earths and minerals is forecast to experience strong growth. However, there are legitimate concerns with regard to the environmental impact of their extraction. Given where some in-demand rare earth deposits are located, Rio Tinto also has political considerations to deal with.
Rio Tinto’s main competitors are BHP Group (LON: BHP), Glencore (LON: GLEN), Anglo American (LON: AAL), Kronos Worldwide (NYSE: KR0), and Alcoa (NYSE: AA).
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